Introduction
Understanding and defining your material datapoints is crucial for effective sustainability reporting and compliance with regulatory frameworks like the Corporate Sustainability Reporting Directive (CSRD). Materiality helps companies focus on the most relevant data points that impact stakeholders' decisions. This article will guide you through the importance of materiality, its connection to data collection, and how to report double materiality results using Greenly's ESG reporting platform.
What is Materiality?
Materiality refers to sustainability matters that significantly impact stakeholders' decisions about a company. In the context of CSRD, it helps isolate the most relevant datapoints from the European Sustainability Reporting Standards (ESRS) framework, which includes over 1100 datapoints covering topics like climate, pollution, resources, and workforce.
Connections Between Materiality and Data Collection for CSRD
Materiality in the CSRD framework determines the relevance of each datapoint based on its association with specific ESRS or sub-topics. Here's how it works:
If a datapoint is related to only one sub-topic: It is considered material if the sub-topic is material.
If a datapoint is related to several sub-topics: It is material if one or more of the sub-topics are material.
If a datapoint is not related to any specific sub-topic: It is material if one or more of the ESRS sub-topics are material.
This hierarchical approach ensures that the most impactful data points are prioritized, aligning with stakeholder interests and regulatory requirements.
How Double Materiality Results are Reported in the Data Collection Module
Once materiality is defined at the sub-topic level in Greenly's Double Materiality module, the platform determines which datapoints are material for your company. Follow these steps to report double materiality results:
Validate Results: Fully validate the Double Materiality analysis results to initialize materiality in the data collection module.
Automatic Population: The materiality column in the database is automatically filled, indicating whether each datapoint is material or not.
Filter Material Datapoints: Use the column filter to display only your material datapoints, streamlining the reporting process.
This structured approach simplifies the complex task of identifying and reporting on material sustainability issues, ensuring compliance and effective communication with stakeholders.
Conclusion
Defining and reporting your material datapoints is essential for comprehensive and compliant sustainability reporting. Greenly's platform offers a robust solution to navigate the intricacies of materiality and data collection, ensuring that you focus on the most impactful sustainability issues. By leveraging Greenly's tools, you can confidently address stakeholder concerns and meet regulatory requirements, positioning your company as a leader in sustainability.
Greenly is here to support you in every step of your sustainability reporting journey, providing the tools and insights needed to make informed decisions and demonstrate your commitment to sustainable practices.